A woman described as the 'Vegan Bernie Madoff' has been jailed for more than three months after she confessed to stealing more than $1million from her former workers and investors.

Sarma Melngailis appeared in Brooklyn's Supreme Court on Wednesday, accused of withholding $40,000 in wages from 84 employees, stealing $840,000 from investors, and siphoning a further $1.6million from her business accounts.

Melngailis, who held a bible behind her back in court as the sentence was handed down, will complete her prison term on New York's notorious Rikers Island.

The 44-year-old rose to popularity when her two Manhattan vegan eateries - Lucky Duck restaurant and Pure Food & Wine - became foodie sensations in the city.

Sarma Melngailis (pictured) pleaded guilty to stealing from investors and staff members during an appearance in Brooklyn's Supreme Court on Wednesday

However, in May 2015, the money disappeared.

During her court appearance, Melngailis - as well as her estranged husband, Anthony Strangis - pleaded guilty to hatching the scam, which involved her not paying 84 employees.

One of the conditions included in her plea required the 44-year-old to fess up to ripping off one investor to the tune of $200,000, the New York Daily News reports.

As part of her punishment, she was also ordered to cough up $1.5million in restitution payments.